Metminco to develop Los Calatos copper project
Australian exploration and mining company Metminco plans to begin development works at its wholly-owned Los Calatos copper project in Peru following the conclusion of a scoping study.
Located in the copper-molybdenum mining district of Southern Peru, the mine is expected to yield 656 million tonnes at 0.45% Cu and 0.026% Mo at an annual rate of 21.9 million tonnes over a projected 31-year life of mine.
Results of the scoping study have demonstrated that the mine is suitable for development as an open pit operation followed by underground block cave mining.
The company estimates copper in concentrate production of 184 million pounds over seven years at estimated operating costs of $1.09 per pound.
Pre-production capital expenditure was determined at $1.5bn, including initial underground development.
Metminco managing director William Howe said that the results of the scoping study support the company's objective of becoming a leading mid-tier copper producer.
"Los Calatos is now well placed for development as a long-life, low cost, operation in an investment friendly jurisdiction in South America.
"Further, it is highly deliverable with the designated status of a 'Project of National Interest' by the Peruvian government, no competing land usage, seawater accessed for metallurgical processing purposes and relatively low power costs compared to similar operations in Chile," Howe said.
Metminco believes that the study significantly de-risks Los Calatos, therefore enabling the firm to consider project financing and development options with strategic partners.
"With cash on hand of $17m early January 2013, and multiple advanced stage development assets, the company has considerable flexibility to focus on the projects and development strategies most likely to deliver real shareholder value in the long term," Howe concluded.